Individuals frequently incur expenses related to experiences that they shared with other friends or roommates. These shared experiences include social events like concerts, group dinners, movie outings, etc. Frequently, one person in the group pays the full price upfront for the dinner or event tickets, and then seeks reimbursement from the other persons in the group. Likewise, one roommate in a group living situation often collects payment from other roommates, and then pays monthly rent and utilities expenses. The individual who pays the shared expense for the group often faces the task of manually calculating the amount that each person owes, seeking reimbursement from each person, and keeping track of who has paid and who has not paid.
Individuals do not have an easy way to manage their shared expenses. They must remember which expenses were shared with which people, and how much money each of those people owe. Some try to track their shared expenses using spreadsheets. But, the amount of manual calculation, data entry, and organization required can lead to errors from miscalculation and forgetfulness. When managing monthly expenses such as rent and utilities, individuals are also challenged with the task of setting deadlines for collecting roommates' shares, and enforcing their deadlines.
Furthermore, reimbursement is usually provided in the form of a cash or check, and the individual managing the reimbursements must endure the cumbersome process of handling checks or physically collecting cash. For example, transferring cash requires the payee and payor to meet in person. Sending checks, on the other hand, takes time for the check to arrive in the mail, and check must still be cashed or deposited before funds are available for paying expenses.
Newer person-to-person (P2P) payment services such as Paypal™ allow electronic transmission of money from one Paypal account to another. But, P2P users are still required to manually manage the shared expense, and open an account with the P2P service. Once money is received, the P2P user must still transfer the money from their P2P account into their bank account before using the money or paying the shared expense. Further, P2P systems typically involve cumbersome registration processes.